Ellison wary of iron ore cost pressures in cut Washington state
The result was supported by growth in Mineral Resources’ basic mining services division and record iron ore sales volumes and prices, despite declining profits from lithium operations.
The reported 5-10% cost increases at the Yilgarn iron ore operations are linked to skills shortages and border restrictions limiting the ability of the WA resource sector to access workers.
“Border closures and blockages following COVID-19 outbreaks in Australia continue to impact MRL (mineral resources) operations, primarily through the forced reduction of personnel movements between states and abroad, ”the company said.
“This has an impact on the group’s ability to transport iron ore from its operations, as the shortage of road train drivers limits the movement of materials. “
In recent months, Mineral Resources has invested heavily in undeveloped iron ore concessions in Western Pilbara as part of plans to become Australia’s fourth largest producer behind Rio Tinto, BHP and Fortescue Metals Group.
Mineral Resources produced 17.27 million tonnes of iron ore in 2020-2021, up from 14.07 million tonnes last year.
Mr Ellison said the record annual result will help Mineral Resource continue its growth in mining services and its ambitions in iron ore.
“This result positions Mineral Resources well to grow our business with other significant investments in iron ore in particular, and seek further growth in our mining services division through the delivery of the highest quality, value solutions. added and innovative for our customers, ”he said. noted.
“The outlook for mineral resources is positive, despite the impacts associated with COVID-19 and the cost pressures creeping into the WA resource sector. “